Helping You Build a Better Business
In practice, you need three things for an effective marketing strategy:
A definition of your target market: what it is; who they are; what they need.
A structure for the products and services you offer: what categories you hold; what range you have at what price within each.
A plan for how you will promote your products and services to your target market: what methods you'll use; what messages you'll communicate; how you'll gauge effectiveness.
If you're reading this as a Business owner you'll already have customers. And to a greater or lesser extent, those customers already think you give them the products and services they need, at a price they're happy to pay. However, if you've never profiled your target market you'll almost certainly be wasting time, effort and money in marketing and selling. Without understanding who you're marketing to and why you don't know whether you're going about things the right ways. And that means you'll be "leaving money on the table" when it comes to selling as much as you could. Can you be bothered to profile your target market?
First, identify your ideal customers The start point is your "ideal" customers. These are the customers you like the best. That may be because they spend lots. It could be because they always pay their invoices on time. It could be they're really great people and make you feel good when working with them. It doesn't matter what the reasons are, what does is that if you had the choice you'd choose all your customers to be just like them. So you need to understand their characteristics: how they spend, who they spend it with and why they spend it that way. Yes, you need to find out this information and if you don't know it, you need to do market research. We'll talk more about this later in this guide. Businesses with trading history will have a good idea about who buys from them. If yours are mainly consumers, you'll know their age, gender, socio-economic status, occupation and interests. If businesses you'll know their location, sector, size and possibly plans and ambitions.
Why do you need all this? Because this helps make sure your marketing is always really appealing to the people who get it. Remember, while marketing costs you £'s every time you do it, the real cost comes from any bad impressions it creates. Using the promo of a pink fluffy pen drive memory as an example, you'd probably want to target that at girls and maybe women. There's an angle on sending it to boys and men but to create the right impression you'd need different messages to explain how it's a great present for a wife, daughter or girlfriend. It's unlikely you'd send marketing like this to businesses - doing that would just be seen as irrelevant. Can you see why being able to segment customers matters? Now, not all existing customers are "ideal". You may have some that buy small amounts; are ‘needy' or difficult to deal with; drive for especially hard bargains; or, worst of all, are unreliable payers This doesn't necessarily mean a ‘needy' customer is problematic; they may buy a great deal of what you do and pay on time without demanding discounts. So, you need to think carefully about what "ideal" means for you and use a combination of factors. We mentioned several "ideal" factors previously - things like: *Regular purchase history *Higher order value *Good payment record
You might also consider further factors like: *Do they refer you to others? *Do they offer you objective feedback on what you do? *Are they fun to deal with?
Taking a selection of both good and bad factors, go through your customer base and rate them: use a simple banding system like A for best and D for worst. ( Consider using Target Components "Customer Rating Tool." ) Going through and rating customers will be a revealing experience and you're likely to find your customer base is not as "ideal" as you'd like. Don't be disappointed: this is actually good thing because it will crystallise in your mind the types of customers you really want – and that's hugely valuable if you're to be successful making a change. As your understanding of your "ideal" customers forms it's likely you'll revisit your customer ratings as you work to be consistent and objective. Be prepared for this to iterative: you won't get it right first time. It's likely to take a few go's. Forming a clear picture of your "ideal" customer also means you'll move from relying on "whoever walks through the door" to "knowing who you want to invite to do business". Most importantly, it will hone your senses more so that when you encounter a new prospect, you're better able to gauge them and decide just how much effort you want to put into winning them. Remember, a key objective in all this is to develop a customer base that delivers you a thriving business and is a joy to work with. With a clear idea of which of your existing customers is "ideal", revisit what you know about them and flesh out as full a picture as you can about them. Market strategy: what you need to know about your customers
9 things you must know about your customers 1. Who they are and what they do If you sell directly to individuals, find out your customers' gender, age, occupation and interests. If you sell to other businesses, find out what industry they are in, their size and the kind of business they are. For example, are they a small private company or a big multinational and what are they trying to achieve (goals, plans, ambitions)? 2. Why they buy If you know why customers buy a product or service, it's easier to match their needs to the benefits your business can offer 3. When they buy If you approach a customer just at the time they want to buy, you will massively increase your chances of success 4. How they buy For example, some people prefer to buy from a website, while others prefer a face-to-face meeting 5. How much money they have You'll be more successful if you can match what you're offering to how much you know your customers can afford. Premium, higher priced products are unlikely to be successful if most of your customers are on a limited budget. You need to match offers with spending power 6. What makes them feel good about buying If you know what makes them tick, you can serve them in the way they prefer 7. What they expect of you For example, if your customers expect reliable delivery and you don't disappoint them, you stand to gain repeat business 8. What they think about you If your customers enjoy dealing with you, they're likely to buy more. And you can only tackle problems that customers have if you know what they are 9. What they think about your competitors If you know how your customers view your competition, you stand a much better chance of staying ahead of your rivals. Practically speaking, it's unlikely you'll know all of these for every "ideal" customer. If your knowledge is patchy, you must consider doing some research. This is a business decision you need to make as it will take time, effort and possibly money to complete. Look at it this way: if it means making a few phone calls then see this for the opportunity it is - your call is about understanding how you can better serve your customers. Remember, "perceived indifference", otherwise known as not keeping in touch, is the single biggest reason customers turn to competitors. Having a full understanding of your "ideal" customers has a really useful spin off: it'll sharpen your view on prospects you'd like to, but don't yet, do business with. These may be prospects you only know in name or they may be ones you've encountered previously - perhaps they subscribed to your email listing or popped in once to request some information. Whatever, these high quality prospects must be included in your marketing going forward – they are prospects that want exactly what you do in the way you do best. This listing of prospects will become the focus of your Marketing and Sales efforts, but before you get on the phone and start sending emails and letters, you must think about what you need to do to maximise your chances of converting your efforts into cash. Marketing effectiveness is drastically improved targeting ideal customers
Ready, aim and… Marketing is about raising awareness and at best it's an imprecise science. That said, it can be drastically improved if your prospect listing genuinely represents "ideal" customers. Be brutal with yourself by going round the houses one more time. Ask youself: *Have I thoroughly identified all the features and characteristics of my customers? Can I honestly say I know them as well as I can? Besides the 9 key things above what else do I know? In turn this may prompt some further research. For example, you might want to find out more about special interests, memberships of clubs/associations etc. *Is my listing of prospects genuinely rational? In other words can I honestly track back each "ideal" customer to the characteristics I originally defined? Is my listing genuine or am I just trying to "make-up-the-numbers"?
Going through your "ideal" customer/prospect listings again and ruthlessly paring them down may feel a bit of a waste of time. The critical issue is this: your sales efforts will only be as good as the quality of the prospecting listing you have. The more off mark it is the more time, effort and money you will waste. You owe it to your business to be as accurate as you can afford to be. Congratulations, you've profiled your target market. Just remember it's only part of the jigsaw For a complete approach to marketing, best practice demands alongside your market profile you need to know: *The categories and ranges of products/services your "ideal" customers want *The best channels and messages to effectively promote your business to them
As a trading business your work to identify "ideal" customers will have given you insight into these questions. However, it has to be said if you haven't actually asked the questions of your customers, you don't truely know the answers. All you have is assumptions however well informed they may be. You must consider whether further and complimentary research is needed. The good news is that this is a chance for more customer contact. What's more it's a highly positive one: customers will be far more receptive to contact concerning how you can better serve them than they will be to that focused on selling to them. Seize the opportunity.
As always, the business advice we give is exactly that, advice! what works for one person may not work for another.